A Model for Understanding SMEs Internationalization in Emerging Economies

Abstract

Understanding the internationalization process of small to medium-sized enterprises (SMEs) is imperative for emerging economies to compete globally. Empirical findings of SMEs from emerging countries are still lacking. Thus, this study intends to fill this gap by providing a comprehensive model for the process of SMEs internationalization in Malaysia. Five major internationalization perspectives namely process and stage models, network, born-global and international new ventures, resource-based view, and international entrepreneurship were integrated in formulating a framework for this study. In-depth interviews were carried out with thirty-two Malaysian experts including academics, policy makers, government agencies, chamber of commerce, and research institute. Interviews were transcribed and analyzed manually using thematic coding and frequency counts analysis. Six important factors with distinguished categories and items pertaining to SME internationalization process were identified: 1) triggering factors; 2) internal factors; 3) external factors; 4) networking; 5) barriers and challenges, and 6) operations for internationalization. The main contribution of this study is a generic model of SME internationalization that can provide apertures on researching into SME internationalization in emerging economies.

Exploring Political Environment and National Culture Impact on Internationalization Readiness of Smes

“…In sum, this result demonstrates that the Political Environment is an important determinant of Internationalization Readiness. This finding aligns with Senik, Isa & Ayob (2014) which also found the Political Environment to be significantly correlated with Internationalization Readiness. Other than that, the value of the effect size (f2) for Political Environment was 0.148, signifying that the effect size of Rewards was small in the hypothesized model (Hair et al, 2014).…”

“…According to Oviat et al (2004), the political environment has a significant relationship towards internationalization. other than that, environmental characteristics in the form of political, economic, social, technical, and legal requirements at home and in the target country also have a significant relationship with the internationalization process (Senik, Isa & Ayob, 2014).…”

Determinants of Internationalization of SMEs using Partial Least Square

“…The issues such as regulations, the policy, and incentives are also affecting SMEs decision to go international market (Senik et., al, 2014). External factors such as political, economic and social aspect of that country are also parts of the decision to go for internationalization.…”

The Role of Relationship Marketing in Small and Medium Enterprises (SMEs)

“…SMEs can be classified into two principal categories: manufacturing and service (Ramli, Palil, Hassan & Mustapha 2015). Additionally, since Senik, Isa, Sham and Ayob (2014) finds that SMEs make significant contribution to the national economy of Malaysia, an understanding of the factors that encourage the internationalization of SMEs is urgently needed. Anggraeni (2014) proposes a comprehensive framework for sustainable entrepreneurial cycles that includes the creation of mission, values and strategy for a given SME.…”